Recent research from our lab and others has challenged the traditional notion that the goal of the speech perception system is to discard unnecessary variability in the signal in favor of discrete lexical or sub lexical units. Rather, it appears that the perceptual system is sensitive to this information and is able to retain it long enough for it to be of use in resolving temporal ambiguities and predicting upcoming phonetic material. This proposal will extend these basic results by examining the phonetic environments in which the perceptual system is sensitive to fine-grained detail and the consequences of this sensitivity for lexical neighborhoods. It will further extend these findings by examining situations in which knowledge of this acoustic detail may predict upcoming phonemes or words using knowledge of phonological assimilation, and also help resolve prior ambiguities created by speaking rate, lexical status, and sentential meaning.